caloll or log on t und.com to ftind out a where a hoveround take you! you're watching "worldwide exchange." the headlines today, president obama's due to deliver a speech in northern ireland ahead of the g-8 summit. where tensions over syria are expected to run high, russian president putin scolded the west about arming the opposition. most foreign leaders agree in welcoming iran's new president. the u.s. expresses hopes that hassan rohani's landslide negotiations over the nuclear program can be restarted. and india's central bank pauses in its monetarying easing, warning that inflation is still a big risk as the rupee

weak weakens. plus, shares down more than 20%. the italian oil service group cutting its profit for the second time this year. it's now talking about a loss for 2013 because of problems in algeria. . you're you're watching "worldwide exchange," bringing you business news from around the globe. >> all right. welcome. the start of a new week here on "worldwide exchange." plenty for us to get to. a lot of geopolitics as well. unions in turkey are calling for a one-day nationwide strike in protest against prime minister erdogan, crackdown on anti-government demonstrations. we'll be on the ground with the latest at 11:10 ct. reserve bank of india has kept interest rates unchanged

but issued a warning against inflation because of a weakening rupee. in the next half hour, we'll have the latest from mumbai. the 50th international air show is taking to the skies. airbus and boeing again dominating with their rivalry. phil lebeau will join us from the industry's biggest exhibit in just a few minutes. and the surprise landslide victory of iran's president election, hassan rohani, takes a cautious welcome for international community. our reporter will be with us in tehran at 11:20 ct. first u.s. president barack obama is going to use today's g-8 summit to seek help over the ongoing civil war in syria. vladimir putin has already berated western leaders. steve is on the shores of northern ireland where that g-8 meeting is taking place. and he joins us.

steve, good to see you this morning. so how raw are the discussions over syria going to be? >> reporter: i think the discussions over syria, russ, are going to be very raw. we saw how contentious the press conference was with putin and cameron and the differences there for all to see. the other thing, the differences have been there for a very long time, the differences between russia and the west over the middle east and north africa have been around a long time. it should be a surprise to no one that russia stands on a different side of the fence over this as well. now, whether they can come to some accord over having an international conference. geneva has been mentioned. but the russians are very touchy about actions we've seen across the board in libya, egypt and elsewhere. they're very concerned about western influence in the eastern mediterranean especially considering the fact that they felt they should have been consulted when it came to cypriot issues regarding how the

eu handled the fact that cyprus was basically going bust and there was a whole host of russian assets there. they were incredibly touchy about it. it is important to note that not only is britain hosting the g-8, but russia is hosting the g-20 later this year. despite the fact there are big concerns and there is a lot of diplomatic hurdles to go through, it's in putin's interest as well not to be with lagerhans. everybody's seen the negotiations on both sides. >> the g-20 summit in 2009, we had these leaked documents which was computers and phones monitored by the britain spying agency. how will those revelations impact this meeting? >> reporter: as of yet, there's been no comment. it will be very embarrassing for any leader who has to speak about those as well. clearly it was a different

government as well in 2009. i was actually there as well. i felt the whole time i was bogged in all my conversations with everyone. the fact remains, i'm just going to put this aside a little bit and say wasn't it ever the case -- didn't we always think that states bugged other states as well? i remember reading antony beaver's comments about tehran in 1945. we all know that stalin bugged roosevelt and bugged churchill so that they got an advantage in those negotiations about the division of europe as well. and i can't believe that from 1945 to 2009 other states haven't been doing similar practices as well. i agree, it's reprehensible. i agree there's a lot of explaining to do from the uk security services. i agree it's incredibly embarrassing as well. wasn't it ever the case that states spied on other states? >> no, they always will. it's just the fact that you don't talk about it. it's a dirty little secret that no one talks about. it's more on the embarrassment side, isn't it? it gets put on the front page.

>> i think you're absolutely right. and it is embarrassing. that and syria are embarrassing issues. david cameron also didn't want to talk about the volatility in the markets. the other thing is that key word and everyone happening on every word of bernanke to see whether that will create more oscillation in the markets. shinzo abe is here. he'll be explaining about abenomics. they'll confirm that their policies are all about domestic growth and nothing to do with lowering the value of the yen or anything like that as well because, of course, that has created even more volatility in the markets. i'll talk briefly about the official agenda, the three "ts" from mr. cameron. tax, transparency and trade as well. and there are high hopes that something will come out of this conference on at least one or two of those issues. and despite the fact that i know the markets have got very used to looking at g-8 and g-20 and saying i don't think anything concrete's going to come out of it that's going to affect me. be careful. if something happens on the trade front, that could be

beneficial. if something happens on the tax front, that could be very negative. we've gotten very used to bemoaning the tax activities of the googles and amazons of the world. let's be careful of what we wish for from an investor point of view because if we do get more clarity and a clampdown on what can or can't be done and perhaps the proposal of central registers on a global basis, this could be big ramifications for the tax affairs of those companies and hence their profits. whilst i say you're probably right to say business as usual. just keep an eye on some of those "ts" from david cameron. if we do get something over the next 48 hours, it could have some ramification for the individual companies. ross. >> yeah, hijack by those other geopolitic issues. thanks for that, steve. we'll be out with him a little bit later, of course, as well. so coming on the heels of the p.r.i.s.m. scandal, the latest report from "the guardian" suggesting british intelligence officials have been

spying since that summit in 2009. we're wondering, has spying gone too far? is it justified for security purposes or potentially it's just that we know more than we thought we did or we thought we knew it, but now it's being confirmed. e-mail us. tweet @rosswestgate. president obama has also touched down in northern ireland for that meeting. he's due to deliver a speech in belfast and speak any moment now. when he does that, we'll also bring you the speech as well. elsewhere, the israeli prime minister benjamin netanyahu says the international community must not loosen sanctions imposed in iran just because reformist-backed hassan rohani won the presidential election. mr. netanyahu said iran's nuclear program must still be stopped, and there should be no wishful thinking. one of the new president's main election pitches was to try to ease international sanctions.

the former nuclear negotiator also promised greater engagement with western powers. we'll have the latest from iran in just over an hour. unions in turkey have caught a one-day strike to protect against the police crackdown on anti-government demonstrations. sporadic clashes continued on sunday. turkish prime minister erdogan addressed tens of thousands of supporters in istanbul yesterday and said it had been his duty to order the eviction of the protesters in the city's park on saturday night. turkish prime minister today -- the interior minister saying he's urging unions not to join illegal strikes. airbus is on track to double its profit margin by 2015 according to the group's ceo. it also said the air express giant hopes to secure more than

800 new orders at the paris air show this week. setting the stage for a competitive fight with rival boeing which releases its commercial outlook later today as well. those comments come amid reports that international finance an a380 narrow jet worth about $5 billion. joining us from the international paris air show, our very own phil lebeau. phil, what's going to be the highlight for you this week? >> reporter: i can tell you what's the highlight for the next couple of hours, ross, rain. lots of rain. we're seeing a thunderstorm roll through the airport here today that is definitely catching everyone's attention. in fact, you're not going to see any flights for the foreseeable couple of hours. and i think a lot of people are looking around saying when the rain goes away, maybe we can get around to covering the paris air show. and you talked about airbus at the very top, and that's really getting a lot of the attention today.

we had the a350 xwb making its first flight on friday. there was speculation we may see at least a pass later on today. airbus getting a lot of attention from the comments that they plan to double their profit margins by 2015. there is also the reported deal with ilfc placing an order for $5 billion with airbus. when we talk with febreze, we'll get a sense of where the market is. when you're talking about wide bodies, the other story is what's happening with boeing and the 787 dreamliner, the dash 10x which will be launched by boeing here this week. they'll also be announcing launch customers for that larger version of the dreamliner. we're going to be talking with jim mcnerney, chairman and ceo of boeing, a little later on today here at the paris air show. as you look at shares of airbus and boeing, or airbus parent

ead,and boeing, keep in mind the big focus for both companies now, growing their profit margins. clearly the orders are there. the backlog is all set. the question, can they wring out the inefficiencies in their production model so they have greater profit margin growth over the next couple of years. we're going to send it become to you as we are in the midst of a storm, ross, that i think a lot of people are hoping clears up within the next hour or two. air shows in a rainstorm are never any fun. >> no, not great. it could be worse, phil. you could be standing out in it. as opposed to under that cover. i hope your feet aren't damp. >> reporter: we're hoping that it clears soon. >> good. all right. phil, catch you later. thanks for that. plenty more to come from phil in a rather rain-affected paris air show. heavy rain. still to come, tom culligan, r

raytheon ceo, will join us. who will win the aviation race? it's never really over. it's the next round, i suppose, of the race. that's all on cnbc.com. we'll be running special online coverage all week of the paris air show. now, the reserve bank of india has stood pat on interest rates. it's warning against inflation risks from the falling rupee. we'll be in mumbai coming up. let's remind you where we stand at the start of the week for european equities. we're weighted to the upside on the dow jones stocks 600. more on the markets when we come back. ♪ [ agent smith ] i've found software that intrigues me. it appears it's an agent of good. ♪ [ agent smith ] ge software connects patients

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of course, we're counting down to the start of the g-8 meeting in northern ireland. president obama has touched down ahead of the g-8 summit. he's going to speak? less than ten minutes. we'll bring you that. these are the pictures of where that speech will take place. meanwhile, we are about an hour and 16 minutes into the trading day here in europe. you can see weighted to the upside at the start of this week, advances outpaced to decline by around 8-2. the ftse has had four consecutive weeks of falls, down

over 100 points last week, 1.6% today. up 40 points higher. the dax is up. the ftse is fairly flat. u.s. stocks have been down three out of the last four weeks. a number of individual stocks to look at. cypen down pretty heavily, 22%. italy's oil and gas engineer saying rising costs are going to cut earnings. once again the company has reduced its forecast. this time by as much as nearly $1 billion. france telekocom worth looking , up over 3%. its board meeting to review the position after being placed under investigation for organized fraud. this stems as his time as the finance minister. and telefonica. it follows a spanish newspaper report the government had halted

its $93 billion offer from the u.s. company. on bond markets, just take a look where we stand. it's really going to be about the fed this week ahead of that, yields just a little higher. spanish yields, we're over 2%. treasuries, 2.08. for treasury yields. and on the currency markets, the yen's a little bit weaker today both against the euro and the dollar. dollar/yen just still below that 95 mark. that two-month low last week of 93.75. auss aussie/dollar steady. euro/dollar, above 1.33, as you can see. a quiet start to the week. ticking higher for equities, currency markets, not quite so volatile. joining us from singapore, hi. >> thank you, ross. asian markets kicked off the week on a largely positive note. the nikkei 225 was the outperformer, up 2.7% to end

above the 13,000 level. and the weakening yen helped exporter stocks higher. and heavyweight japan tobacco rallied 5% today. unlike other japanese firms, this company has little exposure to the yen fluctuations, making it attractive to foreign investors. and its shares have gained over 40% year to date. meanwhile, the shanghai composite lost 0.75% today. take a look at shares of the two financial institutions. everbright bank gained 2% today. new china life insurance up. but on the whole losses in property and also lingering concerns over the economy offset these gains in some of the financial sectors. shrugging off weakness in the mainland, property place outperformed hong kong helping the hang seng gain 1.2% today.

the sector rebounded for the second session after very sharp selloffs recently. so we may be seeing some bargain hunting here. and elsewhere in australia, banking shares helped at the sx 200 reversed earlier losses ending higher by 0.7%. but under pressure, down 0.3%. and some of the southeast asian markets also trading in the green at the moment. back to you, ross. >> all right, catch you later. joining me in the studio, co-ceo of wells fargo financial services. american stocks down three out of the last four, this after good gains this year. is sentiment going to be shifting around now over the next few months as we question the fed and japan? >> undoubtedly we'll continue to see a lot of volatility. just look at this morning. we have the nikkei up 2.75%.

today we have the futures up in the u.s. about 1% and within europe, about 0.75%. and i think we'll continue to see that. the question about japan is, do we believe in abenomics, and can the u.s. unwind qe2. >> and do you have a feeling about what the answers -- we don't really know what the answers are. do you have a feeling what the answers are to those questions? >> i think the question becomes in terms of japan, in terms of that third arrow, i think monetary easing is certainly relatively easy with respect to looking at fundamental restructurings going forward within japan and we'll see what can occur there. >> i guess with dollar/yen, we're always back to where we started. the bank of japan got into their stride. so clearly we got ahead of ourselves in terms of pricing. but how on earth do you price -- it seems to be very hard to price japanese markets. >> without a doubt. right now we're up about 20% for the year.

obviously at one point we were up 40%. but the fact is, with the new prime minister, i think we are looking at a very aggressive market. the question becomes, what will investors do going forward? how patient will they be? >> how hard has this volatility made it? two things have made it hard. the indices have done very well. it's hard to compete when an index is up 15%. and the other thing is then followed by extreme volatility, massive big-figure moves like dollar/yen. >> no doubt about it. i think investors in particular around hedge funds, i think they're starting to understand how they perform. you do have stock-picking funds that have done exceptionally well. you have those that have returned 20%. but i think overall, you really have investors who have come to understand these funds a lot more, that they're not necessarily going to outperform in bull markets. at the same time, they're going to have a higher floor when it comes to bad perform ago

markets. >> i think the interesting thing is they've got to have a warning about when things are good. >> absolutely. >> we'll come back to more about the hedge fund issue in just a second. meanwhile, india's central bank stood pat on rates. it's paused its easing cycle after consecutive cuts. the rbi says inflation still a big risk. and it's warned the capital outflows could worsen india's deficit. of course, currencies and bond markets have all been hit by worries about the fed's tapering. joining us for more is cnbc's reporter from mumbai. hi. >> reporter: hi. thanks for that. you did put everything into perspective. the rbi did not move on the crr this time around, and that was pretty much line with expectations. one, we had the inr which depreciated 6.6% all the way from may 22nd up to june 14th.

so that was actually weighing quite large on the rbi. not to mention the current deficit. for example, we did get the trade deficit data separately today, and that came in at $20.1 billion. and that was simply because of a surge of gold and silver to $8.5 billion for the month of may. this compares to around $7.5 billion this the month of april. however, there is expectation that maybe the june trade deficit could now see some amount of receding because the golden bonds were seasonal in nature and festive in nature. hence, we could see some amount of deceleration going forward. nonetheless, the rbi did see that the inflation concerns continue to be based on how exactly it pans out. they did not ignore growth this time, and they did acknowledge that the government has worked on fiscal deficit, has managed to maintain fiscal deficit at

4.9% on the month, and that they do expect fiscal deficit to be maintained at 4.8%. with that, it's back to you. >> thanks very much indeed for that. let's bring back in chris. one of the problems we've seen is a lot of investors sort of borrowed yen and euro to invest in emerging markets. when things started to turn around with the fed, they had to pull money out quite quickly. which is the space that's been hurt most in the hedge fund world by the recent volatility we've had in the last three or four weeks? >> i think without a doubt, emerging markets have been a challenge. we're looking at the top of the brix with brazil down. we're looking at moscow down about 15%. and i think there is a concern around emerging markets in particular as the dollar strengthens. as you know, many of these countries have dollar denominated debts. that said, in terms of overall fund performance, it actually

has been quite well. i don't recall a time where you look at all of the broad-based hedge fund indices where they've all been up for the first half of the year. some certainly better than others. for example, around depressed debt, up about 6.5%. long-short equity funds up about 6.5%. other than short biased funds which are obviously down, i think all the other indices have performed quite well. >> where is the money going to flow in the second half? which strategies? which funds are going to pick some up? >> i think we'll continue to see money flowing into long-short equity especially given the volatility of markets. investors want to make long bets but at the same time they want hedges in there as well. distressed debt will continue to do well and i think we'll see money flowing into different types of hedge fund strategies. we saw bloomberg, they've raised 800 million euro. an expansion of the shadow banking system. we've seen funds increasing in

more hard assets, private equity funds, for example, investing in fa farmland and other hard assets. >> you talk about shadowing. that's something that regulators are trying to crack down on a little bit. what are regulatory changes? aifm coming in as well. how are they facing that? >> i think aifmd is a concern for the industry, quite frankly. in addition to the increased transparency which many of the managers are concerned about. transparency into their overall strategies. you have the incremental costs, specifically around the depository costs coming from the iafmd. and as a result, it will increase the overall costs associated with managing money within europe. at the same time -- >> is it driving money out of europe? >> i think it will. i think it will -- i think the bigger concern are investors. will they have enough opportunities. european investors to invest in funds outside of europe. right now you have about one in ten u.s. managers within europe. going forward i think you'll see that percentage come down.

>> good to see you. thanks for that. chris joining us from wells fargo global fund services. we are waiting for president obama to deliver his speech in belfast in northern ireland ahead of the g-8 summit. we'll keep our eyes on that. but right now, it may be raining very heavily in paris, but that doesn't stop our man on the ground, phil lebeau. he's talking to raytheon and joins us now. phil? >> reporter: thank you very much, ross. i am joined by tom culligan, ceo of raytheon international. the skies have cleared. that's good news. >> definitely good news. >> reporter: we were talking before we went on, so much attention obviously is focused on the commercial side of the market here, but this show is critical for the defense industry. when you look around the world right now for the defense industry, give me your outlook. >> well, around the world, it's still a strong market. there's no question about it. and even though paris is traditionally known as more of a commercial show, you can see by looking around, there's tremendous amount of defense equipment here. and the companies are all

looking to international growth, especially u.s. companies. so there's a real attention to the market here, and then as you look around the world, it's continuing to be a strong market. there's a lot of threat people are reacting to. >> reporter: middle east or southeast asia, where do you see stronger growth? >> both. the middle east has been very strong, especially in the integrated air and missile defense market. southeast asia is starting to sort of come alive and rebuild their military. north asia has been strong with air and missile defense. >> reporter: you've seen increased demand for your missile defense system. as you look at the threat in the middle east that you mentioned, is this a system where you look at the next three or four years and you see pretty strong trajectory in terms of that growth? >> we have several opportunities in a number of countries. we have a dozen countries that have patriot systems now, several countries in the process of evaluating, and competing or indicating that they're going to purchase a system.

we modernize the system constantly, upgrading it so it stays current with the threat. we think there's an opportunity to the integrated or patriot system in the future. >> reporter: sequestration has clearly had an impact in the u.s. and when you look at the european defense market, it's obviously feeling budget pressure as well. 2015 the bottom in terms of when you look at it and you say, we think that market starts to turn a little bit after that? >> well, we know that these go in cycles. defense downturns do have sort of a -- they go through a cycle, and we think -- we're not sure where this bottom will be. the fact is that u.s. government like everyone else has a number one responsibility to protect its citizenry in the u.s. and around the world and work with its allies. we think that it's going to bottom out and come back up. >> reporter: and just in time. tom culligan, ceo of raytheon international joining us here at the paris air show. there's more to come, ross. we'll be talking with the ceos of airbus, boeing as well as

united technology. so a big day for us here at the paris air show. for now, we're going to send it back to you. >> you did your sundance, phil. that's a remarkably quick turnaround. plenty more, as phil says, to come from the air show. we have a special page on our website as well. don't miss out on anything that phil's doing. if you're interested in aerospace and defense, phil at the paris air show, of course. meanwhile, president obama is on his way here, to the hall in northern ireland where he'll be shortly giving a speech. the first lady, michelle obama, will be introducing him as well. we'll have that. tensions over syria expected to run high at the g-8 summer after vladimir putin has scolded the west about arming the opposition. but most foreign leaders have agreed in welcoming iran's new president. the u.s. has expressed hopes that hassan rohani's landslide victory means negotiations over iran's nuclear program can be

restarted. also, india's central bank has paused in its monetary easing. it's warned that inflation is still a big risk as the rupee weakens. one of the worst-hit currencies in the global emerging market selloff. plus, shares have plunged more than 20%. the italian oil service group has cut its profit target for the second time this year. they're now expecting a loss in 2013 because of problems in algeria. and as we've heard from phil lebeau, airbus and boeing headlining the paris air show in a race for new orders. this as defense giants unveil new designs we've just heard from raytheon. those were a recap of the headlines. we're just waiting for president obama to deliver his speech in belfast ahead of the g-8 summit in northern ireland. he'll be speaking at any moment now. his cavalcade is on its way to this auditorium. we'll have that speech when it starts.

meanwhile, let's recap where we are. an hour and a half into the equity trading day in europe. and stocks are firmer. we had four weeks of losses for the ftse 100. xetra dax is up a percent with the cac down just about 0.10 at the moment. bond yields a little higher today. treasuries, 2.13. the main event, of course, this week will be the fomc meeting. this this is an expectation that bernanke will have soothing yields so market rates don't end up higher. that won't necessarily be his concern. we'll also have minutes as well this week from mervin king's last bank of england meeting two weeks ago when there was no change in quantitative easing. and a big week in the uk as well, on wednesday night, the chancellor will give the mansion house speech, and he's expected to lay out potentially a

timetable for rbs and for lloyd's. dollar/yen, 95 today. remember, we hit that two-month low of 93.75 against the dollar. just off that, but i think most investors will be happy if we just didn't have any volatility for a week. so we wait for the president. meanwhile, india's may trade deficit widened to $20 billion from less than $18 billion in april. the country's trade officials blaming higher imports of precious metals for the uptick. gold and silver imports nearly doubled to $8.4 billion last month. retail consumers snapped up more of the previous precious metals after the recent slide in global prices. india's jet airways getting hit today, just off a percent. the company's regulator postponed a decision on a deal with the company. it first announced plans to buy a 24% stake in jet for $370 million in april.

but india's investment authorities say they want details on how the sale would affect ownership and control in the indian carrier before making a decision. an agreement on safety standards on industrial goods. that's what japan and the eu hope to establish when officials from the two parties meet for the second round of economic negotiations next week. according to the nikkei, the safety criteria would apply to a broad range of goods including automobiles, electronic devices and medical equipment. if all goes well, the pact would eliminate overlapping approval processes which currently take up to three months and make the goods more expensive. china's regulator has given its approval to five foreign companies to invest in the country's capital markets. with the qf licenses, these asset management companies can trade in denominated "a" shares and bonds.

this brings the number of firms holding licenses to 225. singapore's reprimanded, 20 banks in its crackdown on rate rigging. the monetary authority of singapore found that more than 100 traders had tried to influence key borrowing and currency rates. no fines were imposed, but singapore did order the financial institutions to set aside additional reserves for one year. banks such as ubs, rbs and ing were asked to post an extra $800 million to $957 million each with the central bank. singapore also wants those banks to start basing rates on actual trades instead of estimates that were submitted by traders. edward snowden is gaining popularity in hong kong. protesters held a march towards the u.s. consulate in support for the man who admits to leaking nsa information. over the weekend, hong kong's leader said the government will handle snowden's case in

accordance with established laws. and you're watching pictures from northern ireland. the u.s. president obama is due to deliver a speech in belfast fairly shortly. he's due to speak. we'll bring you that live as soon as it happens. should be turning up on that stage in the next few minutes, we understand. italy's fragile coalition cabinet meanwhile has put aside a dispute over tax cuts to pass a widespread package of growth measures. the prime minister's key announcements include 3 billion euros of funding for infrastructure projects and up to 5 billion euros of financial resources for smes. the government also announced relief for italian households with a planned 550 million euro reduction in electricity bills. the greek prime minister has backtracked on his decision to close the country's public forecasts.

the prime minister is proposing to reinstate the helenic broadcasting company. the ruling coalition is in disagreement over the sudden shoutdown. he's accused his alliance partners for failing to press ahead with agreed mass layoffs. and the french president francois hollande has come out in support of france telecom keeping his job ahead of a crucial board meeting today on richard's fate. stefan has the latest from paris. >> reporter: yeah, ross, the meeting will take place today, but we know already that he will remain ceo. francois hollande, the french state which is the main shareholder with a 27% stake will vote in favor of richard remaining the ceo of the company. hollande explained that the first priority was to prevent the company from being affected

by the probe targeting its ceo. he also explained that richard was not suffering from any restrictions linked to the procedure and therefore that he was able. if you missed the story last week, the ceo of france telecom was placed under formal investigation by a french prosecutor. not because he's the ceo, but for his role when he was head of the french finance ministry back in 2008. as for the official statement because in practical terms the french government even if it wanted to replace richard, may not have the power to do so. the government only has three at the company for a total of 15. and therefore it was not able to make a decision on itself. and it's not true that the other shareholders of the company wanted to replace the management of france telecom. if you look at the market reaction this morning which is extremely positive, it's clear that the announcement from the

french president yesterday has pleased investors. there was concern that it would have destabilized france telecom on its 170,000 employees. ross. >> all right. stefan, thanks for that. we'll follow that. there's news out of hanover. it has said this morning that it sees no threat for group net income in 2013. it says it anticipates 100 million euros but should remain significantly below 200 million euros. the stock just up at the high point on the back of that. and bank of england, we've had a survey out from them. they've released details. this suggests the economic downturn to sovereign risks is the biggest threat to the financial system. this suggests the system from falling property prices as well and cybersecurity have been seen. but it picks up on last week

that the sovereign risk is the biggest threat. he talked about this bond bubble and potentially how that may be deflated. meanwhile, european equities, after four weeks of falls for the ftse, up, xetra dax up. u.s. markets have been down three of the last four weeks. the dow 1.2% last week. the s&p and nasdaq also down over a percent. futures today should be looking a little bit higher. the main event, of course, will be what bernanke and the fed say in the two-day meeting starts tomorrow, finishes wednesday. right now 11 points higher on the s&p 500, the dow caught up 100 points, the nasdaq currently up 27 points. besides the fed, of course, announcing its decision wednesday night. we'll also get minutes from the bank of england on wednesday.

mervin king's last meeting. it will be interesting to see whether he was outvoted. he voted for an extension of qe3. but in july, of course, we get mr. carney's first meeting. there will be some expectation about what will happen with him as well. yields just a little higher today. certainly that 2.3% below the near 2.3% we hit last week. japan and the eu are in talks to establish a mutual pact to streamline safety inspections for exported goods between the two sides. let's get more on that. our reporter from the nikkei joins us from tokyo. hi. >> reporter: hi, ross. the mutual recognition agreement between japan and the eu is aimed at promoting trade by removing overlapping approval procedures for exported goods from both sides. for example, japanese exports that meet domestic safety standards currently have to be reinspected from scratch in europe before being allowed on the market. the new agreement would let all inspections be carried out and concluded at the point of

origin, saving time and cost for exporters on both sides. japan and the eu are expected to reach a broad agreement during talks scheduled next week on applying the pact of five categories including automobiles, electrical equipment and chemical products. they account for about 50% of trading value between the two which stood at $150 billion in 2011. the eu has been pushing for this mutual pact and japan in return will press the eu to eliminate tariffs on japanese cars and flat-panel tvs which are currently set at 10% and higher. back to you, ross. >> okay, thanks very much indeed for that. we'll take a short break. still to come, we are waiting for the u.s. president, barack obama, to speak in belfast. we'll have that speech for you when we come back. [ male announcer ] ok, here's the way the system works.

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you are looking at shots from belfast ahead of the g-8. president barack obama is going to be speaking. he's going to use the summit to seek help over the ongoing civil war in syria. vladimir putin has already berated western leaders over their support for syrian rebels. that g-8 agenda has been led by the uk with prime minister david

cameron also talking tough on corporate tax reform. furthering plans for transatlantic free trade deal. also featuring pretty high on the list. we'll talk about iran as well. that will be on the list. but let's just also talk about samsung. it's planning to sell a variation of its flagship galaxy s4 smartphone, transmitting data at more than twice the normal speed. they say the phone will be sold in south korea as early as this month. several overseas carrier to take the phone. back to geopolitics, israeli prime minister benjamin netanyahu says the international community must not loosen sanctions just because rohani won the election. mr. netanyahu said iran's

nuclear program must still be stopped, and there should be no wishful thinking about rohani's victory. one of the new president's main election pledges has been to try to ease international sanctions. the former nuclear negotiator has also promised greater engagement with western powers. we'll have the latest from tehran in around about 20 minutes. unions in turkey have called a one-day nationwide strike to protest against the police crackdown on anti-government demonstrations. sporadic clashes between protesters and police in the capital ankara continued on sunday. the prime minister, erdogan, addressed tens of thousands of supporters yesterday saying it was his duty to order protesters in the park on saturday night. north korea has proposed high-level talks with the u.s. state media announcing the move by saying topics include easing military tensions, changing a truce treaty to a peace treaty and nuclear matters.

no details were given on where and when the talks might be held. and pyongyang insists washington should not be allowed to set any preconditions. the national security agency says its surveillance programs help for dozens of potential terror plots in the u.s. and more than 20 countries. in a new lie declassified released this weekend, the nsa says fewer than 300 phone numbers were checked against a database of u.s. phone records collected last year. the programs were reviewed every 90 days by a secret court. data is destroyed every five years. microsoft and facebook released figures on friday on data they have received from u.s. government law enforcement agencies. apple released data this morning, but they didn't differentiate between which requests were from intelligence agencies just as the cia or nsa. google says it questions the value of such disclosures without being permitted by the government to offer more details on classified requests.

and smithfield foods is facing major opposition to its takeover by a chinese rival. "the wall street journal" reports activist investor value is pressuring the pork producer to consider a break-up instead of the $4.7 billion deal with shanghu interpret. in a letter to smithfield's board to be delivered today, starboard says smithfield could be worth $44 to $55 a share in pieces versus the $34 offer from shanghui. it says it's taken a stake in smithfield which would make it the company's biggest shareholder. smithfield stock up nearly 4%. jpmorgan and morgan stanley have reportedly scrapped plans to revive sales of synthetic cdos which were criticized for adding to losses during the financial crisis. "the financial times" says the banks failed to find investors willing to buy all of the deal's different pieces. synthetic cdos had varying

levels of risk. the ft says investors finding the appropriate price for those pieces has proved difficult ever since cdos were created. jpmorgan stock mildly high. those are all frankfurt trades. and it was a true survival of the fittest on sunday at merion golf club. four golfers were in contention including phil mickelson who made this incredible shot from 75 yards out at the 5th for eagle. that took the lead at 1 under. but he faltered on the 13th and 15th putting him one shot back of justin rose, tapping in for par in a 1 over finish. mickelson had this one last chance. that long putt rolled past the hole, sealing it for rose. he becomes the first englishman to win a major since nick faldo in 1996, the first to win an

open since 1970. so congratulations to justin rose, finishing with a two-shot lead over the rest of the field which included phil mickelson. we are still waiting, meanwhile, for president obama in northern ireland. of course, graeme mcdowell won a couple years ago. he's going to deliver the speech in belfast ahead of the g-8 summit. we'll keep our eyes open for the president to appear on that stage. he'll be introduced by the first lady. ahead of that, let's recap where we stand with european equity markets. we've kicked off this week with an upward move. the ftse 100 up 1%, along with the xetra dax as well. the ftse mib is fairly flat. bond yields a little higher. the main event will be the fed as it starts debating its meeting on tuesday. but it will debate what it will do and the message it wants to send on wednesday.

an expectation to soothe the recent volatility and stop any further backup in treasury rates. we do see rates hitting nearly 2.3% in the middle of last week. of course, that pushes up mortgage rates with it as well. spanish yields just below the 5.6% mark, you can see. and on the currency markets, dollar/yen where we hit the two-month low of 93.75 for dollar versus yen. above that today, just below 95. what most people will be wanting is a reduction in the volatility we've seen. huge big-figure moves, almost daily. and a lot more on dollar/yen. euro/dollar is steady. sterling/dollar tacked up to 1.57. dollar/swiss franc. keep your eyes on that. honey wewell is in the news.

we spoke to the ceo about why he believes china's booming population offers opportunity to the bottom line. we'll hear more from eun in a few moment's time. let's go over to belfast, the young lady speaking ahead of the rez. >> i want to live in a country where it's not my emergency that is important but my value as a person, which is significant. it is important that we all have a unique identity, a choice in life to choose who and what we want to be. we are growing up in a world where we are taught to be tolerant, to live peacefully, we must put this into practice. we must accept our differences if we are to move forward. i think that my age group should be the focus. we are the ones who must build new relationships with people from different communities. barriers need to be broken down. if we are to take away prejudice from young people's mind, we can

create a society that can get on together, a peaceful society. northern ireland is my home. the reality is, it has a past. often in northern ireland we hear about our past. people have many genuine stories, and they are definitely what make our history so important. but truthfully, we should not let the past pull us apart and stop us from moving forward. somehow we need to make a brighter future, a future that builds bridges and brings people together. we need to work together, not apart. we need to listen to each other, and we need to compromise. most importantly, we need to clearly value each other. peace is not easy. and it takes a lot of work to make it happen. i think that it is easy for some to just sit back and hold on to the past. for peace to be an actual

reality, however, we all need to take responsibility in the present. our past, our future. it is all about time. it is in the present time that we really need to be responsible, a kind people, and live to make a better future for ourselves. there is no time like the present. >> you're listening to the belfast conference where president obama will be shortly speaking, introduced by the first lady, michelle obama. the president has touched down this morning ahead of the g-8 meeting. geopolitics will be firmly on the top of the agenda with a decision now to intervene in syria in terms of arming rebels and, of course, with the iranian elections as well. there is the first lady.

thank you so much. thank you. thank you so much. good morning. what an honor. good morning, everyone. first of all, let me thank hanna for that very bold and wonderful introduction. and of course, i want to thank all of you for being here today. it is such a pleasure to be here in belfast. and as you might imagine, whenever we travel to places like this or anywhere else in the world, we've got a pretty packed schedule. we're meeting with presidents and prime ministers and first ladies. we're visiting historical sites

and attending state dinners. and my husband is spending hours trying to make progress on global issues from trade to international security. but wherever we go, no matter what's on our plate, we always do our best to meet with young people just like all of you. in fact, you all might just very well be some of the most important people that we talk to during our visits. because in just a couple of decades, you will be the ones in charge. yes, indeed. you will be the ones shaping our shared future with your passion and energy and ideas. so when i look around this room, i don't just see a bunch of teenagers. i see the people who will be moving our world forward in the years ahead. and that's why we wanted to be here today. let me tell you, when i was your age, i never dreamed that i'd be

standing here as first lady of the united states. and i know that my husband never thought he'd be president either. neither of us grew up with much money. neither of my parents went to university. barack's father left his family when barack was just 2 years old. he was raised by a single mom. and all along the way, there were plenty of people who doubted that kids like us had what it took to succeed. people who told us not to hope for too much or set our sights too high. but barack and i refused to let other people define us. instead we held tight to those values we were raised with, things like honesty, hard work, a commitment to our education. we did our best to be open to others, to give everyone we met a fair shake no matter who they were or where they came from.

and we soon realized that the more we lived by those values, the more we'd see them from other people in return. we saw that when we reached out and listened to somebody else's perspective. that person was more likely to listen to us. if we treated a classmate with respect, they'd treat us well in return. and that's sort of how we became who we are today. that's how we learned what leadership really means. it's about stepping outside of your comfort zone to explore new ideas. it's about rising above old divisions. it's about treating people the way you want to be treated in return. and as young people, you all are in a very powerful position to make some of those same choices yourselves. you have the freedom of an open

mind. you have a fresh perspective that can help you find solutions to age-old problems. and with today's technology, you can connect with other young people from all over northern ireland and all around the world. so right now you've got a choice to make. you've got to decide how you're going to use those advantages and opportunities to build the lives you dream of. because that decision will determine not only the kinds of people you'll become, but also the kinds of communities you'll live in, the kind of world we'll all share together. and standing here with all of you today, i have never felt more optimistic. let me tell you. because time and again, i have seen young people like all of you choosing to work together, choosing to lift each other up,

choosing to leave behind the conflicts and prejudices of the past and create a bright future for us all. and that's what's so powerful about your generation. and again, that's why we're here today. because we want you to know that we believe in each and every one of you. that is exactly why we're here. we believe that you all have the ability to make a mark on this world that will last for generations to come. so we are so proud of you. we expect great things. so with that, i think it would be a good opportunity for me to introduce someone who accompanied me here today. i let him travel with me every now and then. but he is someone who is just as excited and delighted to deliver a message of encouragement and support to all of you. my husband, the president of the

united states, barack obama. >> thank you. thank you so much. thank you. thank you very much. thank you. thank you. please be seated. please. well, hello, belfast. hello, northern ireland. you now know why it's so difficult to speak after michelle. she is better than me. but on behalf of both of us, thank you so much for this extraordinarily warm welcome.

and i want to thank hanna for introducing my wife. we had a chance to speak with hanna backstage, and she's an extraordinary young woman who i know is going to do even greater things in years to come. i want to thank two men who i've hosted at the white house on many a st. patrick's day for their warm welcome, first minister peter robinson. and deputy first minister martin mcginnis. i spend the whole year trying to unite washington around things, and they come to visit on st. patrick's day, and they do it in a single afternoon. i want to thank the secretary of state for northern ireland,

tere teresa. to all the ministers in the audience, to lord mayor marchin. and i want to thank all the citizens of belfast and northern ireland for your hospitality. as our daughters pointed out as we were driving in, i cause a big fuss wherever i go. so traffic and barricades and police officers. and it's all a big production. a lot of people are involved. and i'm very, very grateful for accommodating us. the first time michelle and i visited this island was about two years ago. we were honored to join tens of thousands on college green in

dublin. we traveled to the little village of montegal where, as it turned out, my great-great-great grandfather was born. and i actually identified this individual in this place only a few years ago. when i was first running for office in chicago, i didn't know this, but i wish i had. when i was in chicago, as i was campaigning, they'd look at my last name. and they'd say, oh. there's an obama from the homeland running on the south side. so he must be irish. but i've never heard the gaelic name barack. but it pays to be irish in chicago. so while we were in montegal, i had a chance to meet my eighth cousin, henry, who's also known as henry viii.

we knew he was my cousin because his ears flapped out just like mine. i leafed through the logs where the names of my ancestors are recorded. i even watched michelle learn how to pull a proper pint of black. who's cheering for that? so it was a magical visit. but the only problem was it was far too short. a volcano in iceland forced us to leave before we could even spend the night. so we've been eager for a chance to return to the emerald isle ever since. and this time we brought our daughters, too. in particular, we wanted to come here to northern ireland, a place of remarkable beauty and extraordinary history, part of an island with which tens of millions of americans share an eternal relationship.

america's story in part began right outside the doors of this gleaming hall. 325 years ago, a ship set sail from the river lagen for the chesapeake bay filled with men and women who dreamed of building a new life in a new land. they, followed by hundreds of thousands more, helped america write those early chapters. they helped us win our independence. they helped us draft our constitution. and soon after america returned to belfast, opening one of our very first consulates here in 1796 when george washington was still president. so today names familiar to many of you are etched on schools and courthouses and solemn memorials of war across the united states.

names like wilson and kelly, campbell and o'neill. so many of the qualities that we americans hold dear, we imported from this land. perseveran perseverance, faith, an unbending belief that we make our own destiny and an unshakeable dream that if we work hard and live responsibly, something better lies just around the bend. so our histories are bound by blood and belief, by culture and by commerce. and our futures are equally inextricably linked. and that's why i've come to belfast today. to talk about the future we can build together. your generation, the young

generation, has come of age in a world with fewer walls. you've been educated in an era of instant information. you've been tempered by some very difficult times around the globe. and as i travel, what i've seen of young people like you around the world show me these currents have conspired to make you a generation possessed by both a clear-eyed realism, but also an optimistic idealism. a generation keenly aware of the world as it is, but eager to forge the world as it should be. and when it comes to the future we share, that fills me with hope. young people fill me with hope. here in northern ireland, this

generation has known even more rapid change than many young people have seen around the world. and while you have unique challenges of your own, you also have unique reasons to be hopeful. for you are the first generation in this land to inherit more than just the hardened attitudes and the bitter prejudices of the past. you're an inheritor of a just and hard-earned peace. you now live in a thoroughly modern northern ireland. of course, the recessions that spread through nearly every country in recent years have inflicted hardship here, too. and there are communities that still endure real pain. but day to day, life is changing throughout the north. there was a time people couldn't have imagined northern ireland hosting a gathering of world leaders, as you are today.

i want to thank chief constable matt baguette for working to keep everyone safe this week. northern ireland is hosting the world police and fire games later this year. which mary peters is helping to organize. golf fans like me had to wait a long six decades for the irish open to return to the north last year. i am unhappy that i will not get a few rounds in while i'm here.

i did meet rory mcilroy last year. rory offered to get my swing sorted. which was a polite way of saying, mr. president, you need help. none of that would have been imaginable a generation ago. and belfast is a different city. once abandoned factories are rebuilt, former industrial sites are reborn. visitors come from all over to see an exhibit at the mac, a play at the lyric, a concert here at waterfront hall. families crowd into pubs, in the cathedral corridor. students lounge at cafes, asking each other, what's the crap? hey.

so to paraphrase shamus haney, it's the manifestation of sheer bloody genius, this island is now chic, and these daily moments of life in a bustling city, a changing country, it may seem ordinary to many of you. and that's what makes it so extraordinary. for that's what your parents and grandparents dreamt for all of you. to travel without the burden of checkpoints or roadblocks or seeing soldiers on patrol. to enjoy a sunny day free from the ever-present awareness that violence could blacken it at any moment. to befriend or fall in love with whomever you want. they hope for a day when the

world would think something different when they heard the word belfast. because of their effort, because of their courage, that day has come. because of their work, those dreams they had for you became the most incredible thing of all. it became a reality. it's been 15 years now since the good friday agreement. since clenched fists gave way to outstretched hands. the people of this island voted in overwhelming numbers to see beyond the scars of violence and mistrust and to choose to wage peace. over the years, other breakthroughs and agreements that follow. that's extraordinary. because for years, few conflicts in the world seemed more intractable than the one here in northern ireland.

so that when peace was achieved here, it gave the entire world hope. the world rejoiced in your achievement, especially in america. pubs from chicago to boston were scenes of relevancy. folks celebrating hard work. in america, you helped us transcend our differences because if there's one thing on which democrats and republicans in america wholeheartedly agree is that we strongly support a peaceful and prosperous northern ireland. but as all of you know, all too well, for all the strides that you've made, there's still much work to do. there's still people who haven't reaped the rewards of peace. there are those who aren't convinced that the effort is worth it.

there's still wounds that haven't healed and communities where tensions and mistrust hangs in the air. there are walls that still st d stand. there are still many miles to go. from the start, no one was naive enough to believe that peace would be anything but a long journey. yates once wrote, "peace comes dropping slow." but that doesn't mean our efforts to forge a real and lasting peace should come dropping slow. this work is as urgent now as it has ever been because there is more to lose now than there's ever been. in today's hyperconnected world, what happens here has an impact on lives far from these green shores. and if you continue your courageous path toward a

permanent peace and all the social and economic benefits that have come with it, that won't just be good for you. it will be good for this entire island. it will be good for the united kingdom. it will be good for europe. it will be good for the world. we need you to get this right. and what's more, you set an example for those who seek a peace of their own. because beyond these shores right now in scattered corners of the world, there are people living in the grip of conflict. ethnic conflict, religious conflict. tribal conflicts. and they know something better's out there. and they're groping to find a way to discover how to move beyond the heavy hand of history. to put aside the violence. they're studying what you're doing. and they're wondering perhaps if

northern ireland can achieve peace, we can, too. so you're their blueprint to follow. you're their proof of what is possible. because hope is contagious. they're watching to see what you do next. now, some of that is up to your leaders. as someone who knows firsthand how politics can encourage division and discourage cooperation, i admire the northern ireland executive and the northern ireland assembly all the more for making power sharing work. that's not easy to do. it requires compromise. and it requires absorbing some pain from your own side. so i applaud them for taking responsibility, for law enforcement and for justice, and i commend their effort to building a united community.

important next steps along your transformational journey. because issues like segregated schools and housing, lack of jobs and opportunity, symbols of history that are a source of pride for some and pain for others, these are not tangential to peace. they are essential to it. if towns remain divided, if catholics have their schools and buildings and protestants have theirs, if we can't see ourselves in one another, if fear or resentment are allowed to harden, that encourages division. it discourages cooperation. ultimately, peace is not just about politics. it's about attitudes. it's about a sense of empathy. it's about breaking down the

divisions that we create for ourselves in our own minds. and our own hearts. that don't exist in any objective reality. but that we carry with us generation after generation. and i know because america, we, too, have had to work hard over the decades slowly, grdually. sometimes painfully in spits and starts to keep perfecting our union. 150 years ago, we were torn open by a terrible conflict. our civil war was far shorter than the troubles, but it killed hundreds of thousands of our people. and of course, the legacy of slavery endured for generations. even a century after we achieved our own peace, we were not fully united. when i was a boy, many cities still had separate drinking

fountains and lunch counters and washrooms for blacks and whites. my own parents' marriage would have been illegal in certain states. someone who looked like me often had a hard time casting a ballot, much less being on a ballot. but over time laws changed. and hearts and minds changed. sometimes driven by courageous lawmakers. but more often driven by committed citizens. politicians oftentimes follow rather than lead. and so especially young people helped to push and to prod and to protest. and to make common cause with those who did not look like them.

and that transformed america. so that malia and sasha's generation, they have different attitudes about differences in race than mine and certainly different from the generation before that. and each successive generation creates a new space. for peace. and tolerance and justice and fairness. and while we have work to do in many ways, we have surely become more tolerant and more just. and more accepting. more willing to see our diversity in america, not as something to fear, but as something to welcome because it's a source of our national strength. so as your leaders step forward to address your challenges

through talks by all parties, they'll need you young people to keep pushing them, to create a space for them, to change attitudes. because ultimately whether your communities deal with the past and face the future united together isn't something you have to wait for somebody else to do. that's a choice you have to make right now. >> you're listening to president obama speak to northern ireland ahead of the g-8 meeting there. let's just recap the headlines. u.s. president speaking ahead of that g-8 summit. this as the u.s. expresses hope that iran's new leader will bring a break in nuclear talks. and smithfield foods has called for the company's break rather than a takeover from china. if you've just joined us this morning, after some of the

falls last week, the dow down 1.2%. futures looking a little brighter at the start of this week. we are currently about 122 points above fair value for the dow jones. the nasdaq, 30 points above fair value. the s&p 500 at the moment is around 13 points above fair value. the ftse 100 has four consecutive weekly drops. it was off 1.6% last week. right now up 0.6% ftse mib is just down one-third. meanwhile, israeli prime minister benjamin netanyahu says the international community must not loosen sanctionses imposed in iran just because reformist rohani won the election. he said iran's nuclear program must still be stopped, and there should be no wishful thinking about rohani's victory. joining us with more from tehran, nbc's ali aruzzi.

thanks for joining us. how has the victory been received, and what are the implications? >> reporter: well, the election victory has been received very well. all the reformist-minded people unexpectedly came out, and there was a huge turnout for his vote. when the results were officially announced in tehran, there were mass celebrations across the streets. hundreds of thousands of people took to the streets cheering, very happy, waving banners and chanting slogans like "bye-bye ahmadinejad," a reference to the outgoing preference. in an ironic twist, they were making the same chants four years ago during the last disputed elections which ended in a very, very bloody crackdown. but not so this time. everything went by very peacefully. and people on the whole seem to be generally very happy. the implications for his presidency are very different, though. he faces herculean challenges in the future. a crumbling economy, lagerheads

with the nuclear program and what to do with many, many political prisoners that have been languishing in jail since the last elections. but if anybody's the man for the job, it seems that he might be. he's not a reformist, and he's not an out-and-out hard-liner. he's a centerist and he has good relations with people on both sides of the field. he's probably not from the inner circle of the supreme leader's tightly controlled group of people, but he's certainly on the fringes. and he's being backed very heavily by the country's leading reformists. without their backing, he wouldn't have become president. so he has good relations on both sides of the fence. when he was chief nuclear negotiator during the late '90s, iran suspended uranium enrichment, something he's come under a lot of criticism for domestically. they said that the hard-liners said he sold their nuclear rights down the river. and since president ahmadinejad came into power, iran took a

much tougher stance on its nuclear program. so it's going to be very interesting to see how he navigates the future nuclear negotiations. so the next few months will be very interesting to see what happens here. back to you. >> all right. thanks very much. that's the latest from tehran. meanwhile over in turkey, unions have called a one-day nationwide strike today protest against the police crackdown on anti-government demonstrations. the turkish interior minister is urging the union to stay away from the industrial action, claiming the strikes don't have any legal authority. let's get the latest, nbc's richard engel is in istanbul. richard. >> reporter: these strikes have already begun, and later today you're expected to see some of the labor unions actually marching here in istanbul. this will make it more difficult for the prime minister, erdogan, to continue his narrative that this protest movement is being led by fringe radicals. in fact, yesterday he was calling the protesters terrorists.

strikes in general in this country have been very rare. once the labor unions start to march today, it's possible that they will try and come here to taksim square. what has been happening the last few days, particularly over the weekend, after police moved in to disperse crowds from the square, the police have now set up checkpoints all around the area and have been trying to prevent people from ko congregating, gathering. the square or reaching the square has become the goal. throughout the day yesterday, you saw small clashes all around taksim as groups of young people would congregate, try and rush to the square. and the police in a bit of a cat-and-mouse game were running through with water cannons including some billy clubs dispersing people. they also for the first time started arresting team. and according to turkish

official, about 400 people were detained yesterday. it's unclear if they will be charged or if they're just being held. but the introduction now of the labor unions, about five unions which represent millions of workers in this country, could significantly change the dynamic and make it more difficult for erdogan to say that this is just a minor problem of domestic terrorists which he says are being inspired by the foreign media and an international conspiracy. >> richard, thanks very much indeed for that. that is the latest from richard engel. still to come on the show, investors will look to ben bernanke and the fed this week for some soothing words about the future of qe3. we'll head to the bond pits in chicago to preview the trading week. [ male announcer ] this store knows how to handle a saturday crowd.

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this is "worldwide exchange." a recap of the headlines today. president obama delivers a speech in belfast ahead of the g-8 summit where tensions over syria are expected to run high. this after the russian president vladimir putin scolds the west about arming the opposition. most foreign leaders agree in welcoming iran's new president. the u.s. expresses hopes that rohani's landslide victory means negotiations over stalling the

nuclear program can be restarted. cnbc's phil lebeau speaks to boeing ceo in about an hour. plus breaking up is hard to do. large investors of smithfield foods opposes a takeover deal with the chinese rival and says the pork producer could be worth more split into pieces. >> you're watching "worldwide exchange," bringing you business news from around the globe. president barack obama has been speaking in northern ireland today. he will use the g-8 summit to seek help over the ongoing civil war in syria. steve brings us this report from the shores near the town. >> reporter: ross, thanks very much indeed. yeah, a lot of concern among the g-8 that matters over syria, concern over the broad economy are going to overwhelm the official schedule of david cameron, which is built around the idea of the three "ts," trade, transparency and tax as

well. there's no doubt about it, it was a very frosty relationship last night between putin and his view backing the regime in syria and indeed, of course, the west view that actually the opposition should be given some form of support, possibly milita military. g-8s and g 0s have put aside more attainable aids on tax, trade and transparency of how companies do business. there is something that is probably gettable there. we could on the trade front, for instance, see the start of formal negotiations between the eu and indeed the united states on some form of trade agreement which i'm told is between $100 billion u.s. a year as much as 10 billion pounds in the uk economy. there are some concerns that the french might scoff at this because they want exceptionalism for their enterprises. elsewhere, some form of deal on tax evasion could be on the agenda. they're trying to get companies and individuals globally to have

some sort of register of interest which will cut down on that avoidance and evasion well. shinzo abe in town explaining once again how japanese abenomic policies are aimed at the domestic economy and not destabilizing global currency markets, although it is noticeable ahead of this meeting there's been less rhetoric against the japanese than there was ahead of the recent g-20 which i attended in moscow. it's all to play for still here over the next 48 hours, ross. back to you. >> all right. that's steve with the latest from northern ireland. u.s. markets after being down three out of the last four weeks called higher this morning at the hope as far as futures are concerned. the s&p 500 currently around 40 points. the nasdaq is about 31 points above fair value. we are on triple-digit gains for futures now. the dow currently about 135 points above fair value. the dow down 1.2% last week. european equities down four out of the last four weeks. the ftse 100 down 1.6% last

week. currently up. we're pretty much on session highs for this session today. the ftse up. cac up 1.7%. as we're into this new week, l volatility over the next four weeks. here's a recap of what some of the guests on cnbc have already said today. >> we really like actually is atlantic spread on the basis of the u.s. basically, the recovery there going quicker than the eurozone and liquidity conditions tightening quicker in the u.s. than in europe. that's something we've advised to our clients. >> i think it is time to take profit in emerging markets, if you've seen that profit and you've probably seen that profit if you've been invested in em debt. the weakest link in emerging market as it happens right now is effects because that's one asset class that has just not performed despite bernanke's

qe1, qe2, qe3, you haven't seen them outperform. >> you're seeing, again, yield coming a bit back into fashion in terms of equities. but i think more broadly, probably there's going to be a greater focus on growth of yield rather than just sort of headline yields. so this is the time to be really very focused on whether a stock that you might be holding is a value trap or whether it's something which really has a good flow of growing cash flows in the future. >> those are some guests. joining us, president tradersaudio.com. the s&p off nearly 4% from the 4 1/2-year height we hit a few weeks ago. how do you see this week panning out with the fed? >> well, i think, obviously, all eyes are on the fed right now. this is, for the most part, the big number, if you will, there's

a big indicator that most traders are looking towards. but most recent fed activity meetings, any statements regarding qe3 have definitely -- or any quantitative easing, if you will, have definitely sparked some sort of two-sided activity over the last few weeks now. we've been seeing much more sell side activity. participants much more two-sided, rotational-type activity versus that heavily buy side bias activity we had been seeing. there's a lot of speculation right now out there, and it's really created a significant amount of volatility in the market. we've seen that in the volatility index, inching its way higher. while the s&ps have been kind of chopping around the 1640 to 1590 level, if you will, forming a bit of a balance, showing that we're seeing accepted area of value at that point, which is basically just an area where the buyers and the sellers are meeting and finding common price. i think it could potentially be the next catapult, if you will, to get us out of this balance that i've been talking about.

the next vertical move, if you will, where the market's going to seek value. but we clearly have our upper extreme level, as you just mentioned, that spike high print i think in the s&p is right around 1680. and our most recent low has been established as well, right around that 1590 level. fairly well-defined levels at this point but definitely the talk of the town, if you will. it's definitely what traders are looking for this week. >> yeah. i mentioned the s&p. i meant the s&p financials at that near 4%. look, you mentioned volatility as well and the vix up over 4% during the course of last week as well. and huge volatility in the currency markets, too. dollar/yen, dollar weaker against the yen. how much are people looking at those cross rates? >> oh, significant amount. i mean, a real big focus over the past few months has been the dollar. unfortunately very little in terms of rhyme and reason and correlation associated with the stocks. i mean, normally you'd think

with the dollar rallying we would see stocks come off. it's kind of been both ways recently. but for the most part, i really don't put much weight in terms of where the dollar is right now at these levels. we've been between 78 and 83, if you will, or 84 and 80, depending on how you look at it. right now right around that 81 level. again, euro currency, i just don't really give it a lot of weight at this point. i haven't really seen anything convincing out of the euro over the last two years. again, basically around this 130 handle. i really think the focus is even more towards the interest rate. futures products, we've seen a big move in the 30-year over the last couple weeks. i think that should continue again with the recent volatility we're seeing, the recent speculation that i mentioned associated with the fed announcement coming out on wednesday. you know, there have been multiple major markets on the move. i just don't think that it's necessarily been the currencies that most traders have been looking on to really gauge any -- or determine any trade based on, again, there's really just been very little conviction

associated with those major markets. >> ben, have a good day and a good week. for tradersaudio.com in chicago. meanwhile, smithfield foods is facing opposition -- more opposition to its takeover by a chinese rival. cnbc's seema mody has the latest. >> that's right. starboard, an activist investor, is pressuring smithfield to consider a break-up instead of the proposed $4.7 billion deal. "the wall street journal" reports in a letter to smithfield's board to be delivered today, starboard says smithfield could be worth $44 to $55 a share in pieces. the company is offering $34 a share. starboard proposes splitting the company into three parts. u.s. pork production, hog farming and international fresh and packaged meats. starboard says smithfield never sought bidders for these pieces and believes that interested suitors exist. "the journal" says starboard has taken a stake in smithfield

which could vault it past vanguard. continental grain also called for a break-up but mostly exited its stake in smithfield following last month's announcement of the takeover. checking smithfield in germany this morning, shares up about 4% on the day. ross, back to you. >> seema, thanks for that. president obama has made a speech ahead of the g-8 summit in northern ireland this morning. after the break, nbc's chief white house correspondent, chuck todd, will wrap up the main points. we'll return in just a few minutes. we went out and asked people a simple question: how old is the oldest person you've known? we gave people a sticker and had them show us. we learned a lot of us have known someone who's lived well into their 90s. and that's a great thing. but even though we're living longer, one thing that hasn't changed: the official retirement age. ♪ the question is how do you make sure you have the money you need

to enjoy all of these years. ♪

a recap of the headlines this morning. u.s. president barack obama speaks in northern ireland ahead of the g-8 summit. as the u.s. hopes that it will bring a break in nuclear talks. and smithfield foods calls for the company's break-up rather than a takeover from china. the u.s. president has addressed students in belfast ahead of the g-8 summit in ireland. with more, we're joined by nbc's chief white house correspondent, chuck todd. chuck, thanks for joining us. how would you characterize the speech?

>> reporter: i would say it was about bucking up northern ireland, particular lly their students, trying to motivate them, saying 15 years removed from the peace process and of course northern ireland's economy has been much slower to grow. the society still sort of growing out of what was decades of turmoil and tumult, obviously. and so the speech, to me it was familiar. i've heard him give similar speeches to other young groups and other international audiences, but this one had a feel of hey, buck up. it's your turn. you've got to take over. you know, your parents' generation took the risk to make peace. now it's your job to try to build northern ireland into a more productive society and more productive economy. >> how does this lead into what he hopes to achieve during the g-8? >> reporter: well, of course, the g-8 now is going to be dominated by all things having to do with syria. and i expect a pretty tense bilateral meeting between the

president and the russian leader, vladimir putin. we know what happened yesterday with david cameron. clearly the disagremt on what to do about syria seemed to percolate a lot in that meeting. and it showed up, you could tell, by the body language between cameron and putin. it didn't go well. one wonders if it's going to go any better when putin and president obama meet. here we are, we call it the g-8, and you remember for years, it was the g 7. and it feels like we're back to that. because you'll have the g-7 on one side when it comes up what to do about syria and propping up the opposition. and old country number eight, russia, on the other side. how isolated does putin feel? the more isolated he feels, does he almost feel emboldened? a old sort of real politic coming back to one of these summits. >> nbc's chuck todd in northern ireland. joining us, tina fordham,

political analyst at citi. tina, how surprised are you by the moves on syria? talk talked about the tensions between the u.s. and russia. just the fact that we're talking about arming and missile defense and those issues. >> this hasn't happened for a time. certainly there's been pressure on the president to arm the rebels for some months. the syrian conflict is in its third year, 93,000 killed, with russians providing the s-300s. there was a big push to suggest that the u.s. might level the playing field. hence this decision to provide the small arms. but we haven't gone anywhere near the arguably more significant options like a no-fly zone. >> what this has done is put this on the top of the agenda at the g-8. david cameron who we're seeing here pictures of his press conference with vladimir putin had wanted to put an issue of corporate taxation near the top of the agenda. do you see anything concrete coming in terms of that policy,

trying to make corporates appear to pay fair attacktax? >> i think that's an interesting agenda. what it shows is you can have the conservatives in uk arguing for the same as governments on the left in europe. it is one of the few issues in the post-global financial crisis environment on which everyone can agree. but, of course, it's all about implementation. and the truth is whether we look at the u.s. or anywhere else, actually agreeing on tax reform at the national level let alone at a super national level is not going to be very easy to come by, but it sounds good. >> even in the u.s., we still can't agree and allow u.s. governments to repate yriate. stay there. rohani has received a cautious welcome from the international community. can he deliver on his election

promises? he's been put in power by many of the moderate voters. we'll talk about that when we come back. years old. in that time there've been some good days. and some difficult ones. but, through it all we've persevered, supporting some of the biggest ideas in modern history. so why should our history matter to you? because for more than two centuries, we've been helping ideas move from ambition to achievement. ♪ and the next great idea could be yours. ♪ [ agent smith ] i've found software that intrigues me. it appears it's an agent of good. ♪ [ agent smith ] ge software connects patients to nurses to the right machines while dramatically reducing waiting time.

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can help you do what you do... even better. ♪ the israeli prime minister benjamin netanyahu says the international community must not loosen sanctions imposed on iran just because reformist-backed hassan rohani won the election. mr. netanyahu says their nuclear program must be stopped and there should be no wishful thinking about his victory. one of the new president's main election pledges is to try to ease international sanctions after he also promised greater engagement with western powers. tina fordham is still with us. what are the implications? because clearly he's been put in power because he secured the vote of the moderates. >> well, it's very interesting

to see this surprise outcome to start with because it wasn't anticipated either by political analysts inside iran or outside iran, right? so we know that this is a heavily controlled process. there were almost 700 candidates initially whittled down to six. the one who was not favored to win, the one who was the most moderate, ended up winning. he had three times the number of votes of his closest competitor. so in that sense -- >> a pretty clear knockout. >> that's right. we call that a landslide, really. but what does it mean? is it a game changer? i think there are a few key implications. one is that the iranian public has rejected the fundamentalist hard-liner candidates. it's quite clear that they associate those policies with bringing the economic hardship that was the number one issue in this election. the question is -- and we see this in protest votes around the world -- whether the candidate, you know, that gets this boost

and the hopes of the people are invested in him actually has the political capital. >> whether he can reopen talks with the west. there is a chance to say the previous eight years of ahmadinejad's regime were different. the question is whether they can actually say, look. give us -- let's reopen talks. give me something to take back to the people, and we'll look at the nuclear issues and everything else. is there a hope that may happen? >> i think there's more than a hope that it will happen. the white house has said explicitly that they intend to suggest that the talks resume quite soon in order to test the resolve of the regime to engage with the west because, you know, as was previously noted, rowhani isn't talking about ending the nuclear program. he's basically talking about having their cake and eating it, too, continuing with enrichment but reducing the pressure from sanctions. this is important for crude prices, which is the number one market implication of this. we do think that the development, although not a game

changer, kind of pushes down that geopolitical risk premium. >> tina, good to see you. tina fordham, senior political analyst at citi. european markets today are up. first trading day after being down four consecutive week. cac up about a percent. the ftse is up nearly a percent. a reminder of what's on the agenda stateside today. it's a fairly quiet day. investors, of course, really looking ahead to the two-day fed meeting. it begins tomorrow. that's going to dominate. the survey today is out at 8:30 eastern. and it's followed by the monthly sentiment survey from the national association of home builders at 10:00 a.m. u.s. futures, they're pointing to a jump at the beginning. dow futures currently up 133 points above fair value. the s&p at the moment is just around 14 points above fair value. that countdown to the open stateside continues now with "squawk box." whatever happens, we hope you have a profitable day. bye for now.

goods morning. a major air show taking flight in paris. rivals boeing and airbus battling for supremacy. the ceo will join us live. g-8 leaders are gathering in ireland. on the agenda, the situation in syria, tax avoidance, it says here evasion, and free trade. plus, there's one event set to dominate the global market story this week, and that is a two-day fed meeting begins tomorrow. check out the cover of "usa today" today. it's monday, june 17th, 2013. "squawk box" begins right now. big ol' jet airliner ♪

♪ don't carry me too far away good morning, everybody. welcome to "squawk box." i'm becky quick along with joe kernen and andrew ross sorkin. as investors prepare for a week dominated by the fed, look out, dow futures already 130 points above fair value. s&p 500 futures up by almost 14 points. it's all coming after you see what happened with the nikkei in japan. a gain of 2.7%. the hang seng was also up pretty handily, up by 1.2%. in the early trading in europe this morning, take a look and you're going to see where things stand right now. but again, with all these other green arrows around, you see some of the same things happening. in france, markets up 1.7%. the dax up almost 1.4%. our newsmaker is boeing chairman and ceo jim mcnerney standing by with phil lebeau at the paris air show joining us in just a moment live. first, andrew has a roundup of the morning's top headlines. good morning. >> good